Credit Archives - Page 3 of 82

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Two New Ways to Raise Your Credit Score

Posted on February 11, 2019by Admin

Credit scores play a major role in your ability to do many different things in life, ranging from getting a mortgage or car loan to being approved for renting an apartment. A good credit score can also secure a lower interest rate when you do receive financing for a large purchase. It pays to have a good credit score and rebuilding a damaged credit score can take time.

There are two new ways to boost your credit score. These new programs include the UltraFICO from Fair Issac, the creator of the FICO Score, and Experian Boost. These two new programs can potentially help you increase your score, especially if you have a limited credit history or have a lower credit score.

UltraFICO

The first of these scores, the UltraFICO was launched in January 2019 and is planned on being available to most lenders in the U.S. by mid-2019. The program is part of a joint venture with FICO, Experian and Finicity. UltraFICO allows FICO to look at a consumer’s bank and financial accounts to show lenders that you do have savings and the money available to make loan or credit payments if approved for financing.

FICO anticipates that this program will benefit approximately seven out of ten consumers whose financial accounts can show a history of good savings and financial behavior. Even consumers who do not have a FICO score currently could still be eligible to receive an UltraFICO score.

This score could be more beneficial to someone who has a rather large bank balance but a limited credit history. So long as the consumer can show he or she can save money responsibly, the fact that he or she has not applied for credit much in the past will not hurt them with the UltraFICO score.

One point to keep in mind is UltraFICO is only available for loans or credit cards that are applied for with a lender who uses Experian. If the lender uses Equifax or TransUnion, the borrower will not be able to take advantage of this opportunity. Before applying for the loan or credit, as the company which credit bureau they use to review new applicants. If the company says they do not use Experian, it may be advisable to use another institution if you believe the UltraFICO score will help you.

Experian Boost

Another program is set to be released in the early months of 2019, known as Experian Boost. The Experian Boost program is different from UltraFICO in that it allows lenders to review the borrower’s financial history through their bank accounts, specifically related to utility bill payments. The key is not to see that a consumer has a sizeable savings but rather a demonstrated, good history of paying his or her utility payments in a timely manner over a set span of time. Also, unlike the UltraFICO score, the data found through this review is added automatically and directly to your Experian credit report. The borrower must opt in to allow his or her utility information to be visible in the Experian credit report, and if the results are positive, they will be posted immediately to the borrower’s Experian score. Borrowers are allowed to sign up for early access to the program.

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If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

The Top Ways to Avoid a Financial Crisis, according to a Bankruptcy Judge

Posted on February 7, 2019by Admin

No one wants to think about what he or she would do if faced with a major financial crisis. However, what if the unthinkable happens, and you find yourself facing a financial situation you never thought you would encounter? Some bankruptcies are precipitated by events that are beyond a person’s control – for example, a major health crisis, a job loss or divorce. But a number of causes are entirely within a person’s power to stop. After 12 years serving as a bankruptcy judge, the Hon. Margaret Cangilos-Ruiz, the chief judge for New York’s Northern District Bankruptcy Court says she has seen it all. In a recent interview with MarketWatch, she shared her insight on how people can avoid bankruptcy and setting foot in her courtroom.

Monitor Your Credit Cards

It can be very easy to rely on credit cards to make all of your daily purchases. However, when that bill comes in the mail, and you see just how much these small purchases add up to, the outstanding balance can be more than you predicted. It can also be tempting to only pay the minimum balance listed on the statement, promising yourself that you will be catch up on the payments eventually. A good rule of thumb is to never carry a credit card balance from month to month. If at all possible, it is best to pay the balance in full, but if this cannot happen, put together a plan to pay off the balance completely over time.

Not only should you not carry a large balance for too long on your credit cards, it also helps to pay them on time. As soon as you miss one or two payments, your card’s interest rates will skyrocket, making it even more difficult to pay down the balance. As soon as you receive the bill, make sure you do not put it aside and forget to pay it. You will be saving yourself hundreds of dollars in fees and penalties for the long run.

Monitor Your Credit Score / Report

It also helps to keep an eye on your credit score. A good credit score will make it easier for you to take out a loan in the future for big purchases, such as a home or a car. Also, you never know when you will hit a rough patch down the road and will need to take out a loan to help finance medical bills or pay off an unexpected expense. By periodically checking your credit report, you can keep track of your score and also make sure that no incorrect accounts or mistakes are on your credit report. It is best to discover these issues ahead of time and fix them before they become a bigger problem.

Practice Responsible Spending Habits

Paying off your credit card and creating a budget is one thing, but these cannot be possible without controlling your spending. One of the biggest ways to do this is to limit how much you spend on “non-necessary” items and differentiating between something you want and something you need. If there is a large item that you want, save up for that item and only purchase it when you have enough money to pay for that item. Keep an eye on the small purchases you make on a daily basis, as those do add up. Many consumers find success in allowing themselves to use a certain amount of cash every month on non-necessary expenses. Once the cash is gone, they are not able to purchase anything more of their “wanted” items. Resist the urge to rely on credit cards to pay for a cup of coffee or a new shirt after you go through your cash allowance for the month.

Bankruptcy Law, Credit, Credit Card Debt, Debt Relief, Timothy Kingcade Posts

Do you have enough debt to file for bankruptcy?

Posted on January 30, 2019by Admin

One of the common misconceptions surrounding bankruptcy has to do with how much debt you must have to qualify for bankruptcy. Bankruptcy laws do not have a set minimum debt requirement for someone to be able to file for bankruptcy. Ultimately, it depends largely on the person’s financial circumstances, including the type of debt he or she has, as well as the person’s ability to pay back the debt, along with other factors.

When it comes to debt levels, how much debt you have is only one consideration made when determining whether you should proceed with a bankruptcy filing. Unlike a Chapter 7 bankruptcy case, a Chapter 13 bankruptcy does have a maximum debt amount for debtors considering this form of bankruptcy. Currently, you cannot hold more than $1,184,200 in secured debt or $394,725 in unsecured debt when filing a Chapter 13 bankruptcy case. These numbers do fluctuate depending on inflation and can change from year-to-year.

Filers are limited in how many times they can receive a bankruptcy discharge within a set amount of time. For example, if you filed for Chapter 7 bankruptcy and received a discharge, you must wait eight years before being able to file for Chapter 7 again. Therefore, if you do not have a significant amount of debt, you may want to consider whether you will anticipate needing to file in the future. Is it worth it to file for bankruptcy now on a smaller amount of debt and be barred from filing again, if needed? A bankruptcy attorney can talk through these options with you to help you make the best choice.

Bankruptcy looks at the different types of debts you carry and whether these debts can be discharged. Certain debts are considered non-dischargeable, including priority tax debts, student loans in most cases, child support, spousal support, and any obligations arising from a personal injury case caused by wrong actions, which can include drunk driving. For instance, if most of your debt is in student loans, a bankruptcy may not be your best option, while a person who carries mostly credit card and medical debt will find bankruptcy beneficial.

If you are filing for Chapter 7 bankruptcy in Florida, you can use Florida bankruptcy exemptions to protect your property. In addition, residents are provided unlimited exemptions for homestead, annuities, and the cash surrender value of a life insurance policy. Florida has one of the most generous homestead exemptions in the country.

Even if you do not have a large amount of debt, if you are being sued or the matter is being referred to collections, it may be best to file for bankruptcy now instead of later. As soon as you file for bankruptcy, an automatic stay will be issued, putting a stop to all collection actions. If you wait too long, and a judgment is issued on the debt, resulting in wage garnishment, it may be too little too late. It is for this reason that it is important you meet with an experienced bankruptcy attorney to talk about your financial situation and whether bankruptcy is right for you.

Bankruptcy Law, Credit, Credit Card Debt, Debt Relief

Residents in Southern States Struggle the Most with Credit Card Debt

Posted on January 29, 2019by Admin

Credit card debt is a problem for many Americans, but it seems it is a bigger problem for those living in southern states. According to research produced by creditcards.com, the large majority of credit card debt is carried by individuals living below the Mason-Dixon line.

According to the creditcards.com study, approximately 40 percent of Americans earn enough money to pay their balances off in full every month. However, for the remaining 60 percent, those balances grow more each month, and the cardholder only ends up paying interest on the card through monthly payments, never quite making progress in paying it down.

The study ranked the states not necessarily based on the total debt held by individuals in those states. They were also ranked by the number of months it would take to pay down the average total credit card debt by making payments on the balances equal to 15 percent of that state’s monthly income.

While New Mexico tops the list of states when it comes to credit card debt, with the average balance is $8,323, southern states including Louisiana, West Virginia, Alabama, Arkansas, Mississippi, and Georgia follow New Mexico in terms of high balances being carried from month-to-month. The researchers that conducted the study correlate the high credit card balances with lower income in these states.

In the states with higher income levels, these cardholders are more likely to be able to pay off their balances in full every month. The lower the income and higher the balance, the less likely the cardholder will be able to ever conquer his or her debt. Further, the study showed that in the wealthier states, a credit card payment that was equal to 15 percent of that state’s median monthly income will be much more manageable than it would be in states with lower income. It just so happens that the states with the lower income were also southern states.

People living in the Miami metro area, which includes both Fort Lauderdale and West Palm Beach, carry the second-highest credit card debt balances in the country, second to San Antonio, Texas. Texas was reported as being a state with three of the five cities that reportedly had the highest credit card debt.

As bankruptcy attorneys, we see credit card debt as one of the most common problems facing those with serious financial challenges. It is not surprising with the high interest rates, unreasonable fees, harassing debt collection calls, penalties and never-ending minimum payments that do not even make a dent in your actual debt. We offer additional tips for eliminating credit card debt on our blog.

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Bankruptcy Law, Credit, Credit Card Debt, Debt Relief, Timothy Kingcade Posts

IRS Will Pay Tax Refunds During Government Shutdown

Posted on January 8, 2019by Admin

The government shutdown has taxpayers nervous about what it will mean for their tax refund. However, a statement made today by the acting director of the White House Office of Management and Budget, Russel Vought, said the Internal Revenue Service (IRS) will issue refunds even during the government shutdown.

It had been speculated that the IRS would accept tax returns, but refunds would be delayed until the government was fully functioning again. This situation is exactly what happened during previous shutdown contingency plans. However, the administration assured taxpayers that would not be the case this time around. It is a decision that may reduce political pressure on Congress and President Trump to reach a deal to reopen the federal government.

Last tax season, the average tax refund was estimated at $2,899. If you are struggling with debt, a tax refund can be your ticket to a fresh financial start and pay for the costs of bankruptcy.

Data from the Administrative Office of the U.S. Courts shows that Chapter 7 bankruptcy filings in March were 26 to 34 percent higher during March, and 15 to 25 percent higher during April from 2013 through 2016.

How do you know if bankruptcy is right for you? Consumers should strongly consider Chapter 7 if any of the following are true:

Problem debts, such as credit cards, medical bills or other high-interest loans, account for more than 50 percent of your annual income;
You are using credit to pay for everyday expenses;
Your credit cards are maxed out with no end in sight;
Your wages are being garnished;
You are being sued by debt collectors;
You are in danger of losing your home.

In the 2018 tax filing season, 18.3 million people claimed $12.6 billion in tax refunds within the first week of filing season alone. This “season,” normally begins at the end of January or early February, considering employers are required to mail W-2s by the end of January.

During shutdowns in years past, the IRS had stated that refunds could not be issued during a shutdown due to the agency’s interpretation of the Antideficiency Act. This act governed what type of work was allowable during a shutdown, which normally only included government work that was necessary to protect life and property. Previously, IRS work was not considered one of those categories.

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Bankruptcy Law, Credit, Credit Card Debt, Debt Relief

Average U.S. Household Carries more than $8,000 in Credit Card Debt

Posted on December 11, 2018by Admin

Americans are borrowing more this year, as the average household carries $8,284 in credit card debt, according to the personal finance site WalletHub. This total surpasses the previous year, where the amount of debt was $8,107 per household.

The total amount of credit card debt held by Americans is now at a staggering $974.2 billion, which is three percent more than the $949.9 billion reported last year. Miami is reported as the second highest metropolitan area with the most credit card debt in the U.S.

One major problem with these figures is how close the debt is to being at the point where it is considered “unsustainable” when comparing the debt held to the average income being brought in by the average American.

The current debt load is said to be $177 from this point of “unsustainability.” What is even more worrisome is the Federal Reserve is expected to increase interest rates on December 19.

The study reports that American credit card debt is nearing the highest point it has been since the Great Recession. Financial experts are concerned that it could go past that point in 2019 if things do not change.

Not all the figures from this study were so dismal. Many Americans have worked diligently to pay off their debt, and WalletHub’s data showed that Americans paid off $40.8 billion in credit card debt in the first quarter of 2018. This figure represents the second-largest quarterly payoff of debt ever reported, which is promising. However, the study did also report that since that time, Americans have added $38 billion back to their credit card debt balances.

Many consumers have looked for resources to find debt relief. For some, credit counseling is a valid option, although it is important you know what to look for when choosing the right credit counseling agency. Our attorneys are here to help you if you are struggling to deal with credit card debt and wish to know your options.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

What Bankruptcy Does to Your Credit Score

Posted on December 5, 2018by Admin

A common concern people have when filing for bankruptcy is the effect it will leave on their credit score and their ability to access credit, again. While bankruptcy does affect your credit score, it is sometimes the last resort to rebuild your credit and your financial future. In fact, it is oftentimes easier to reestablish your credit after filing for bankruptcy, because you are essentially given a “clean slate.”

It helps to sort through the myths and facts before making that final decision, and if you do choose to file for bankruptcy, this does not mean all hope is loss. There are proven ways to rebuild your credit score after bankruptcy, and our clients are proof!

My credit score said on all three reports 775, I couldn’t believe that I had such a great score before 10 years. Tim for me was the best move I have made for my situation. I have no regrets, I am glad the past is the past. – Bill T.

Hi Tim- I just wanted to send a quick note and thank you and your team for handling my bankruptcy case. It is only a month or two after discharge, and my credit scores are already in the upper 600’s. – C.S.

The effects of bankruptcy on a person’s credit score depends on the score the filer had before filing for bankruptcy. If you have a higher credit score, the effect the bankruptcy will have will be more noticeable. However, if you have a lower credit score to begin with, the change may not be as much after filing for bankruptcy.

According to data from FICO, for individuals who had credit scores of 780 or more, the average amount of decrease is around 240, with a resulting credit score of 540. If the filer had a fair credit score of around 680, the decrease is on average 150 points, resulting in a score of 530. Both scores end up at roughly the same point, but the drop that the filer sees in getting to that score is noticeably different.

The good news is the American credit scoring system allows consumers to rebuild their credit score quite quickly after filing for bankruptcy. Even with a credit score at 550, you can still get back to a respectable score within one to two years through demonstrating good financial habits.

These habits include monitoring your credit report on a regular basis, ensuring that any accounts that are at a zero balance. Many financial experts recommend using a secured credit card to use for purchases to rebuild credit. After some time has passed and you have successfully used the secured card for a period, you may be able to slowly take on new credit, although it is never recommended that you have more than one account opened within a six-month period.

Rebuilding your credit is important for many reasons, the main one being it will allow you to be able to borrow in the future. Many filers worry that they will never be in the financial situation to purchase a home or qualify for another loan- these are all bankruptcy myths. Stick to a budget and a sound financial plan following bankruptcy, and you will be back on your feet before you know it.

Bankruptcy Law, Credit, Credit Card Debt, Timothy Kingcade Posts

Repayment Trick to Help Pay Down Credit Card Debt Faster

Posted on November 26, 2018by Admin

If you are struggling with credit card debt, you are not alone. As of September 2018, the Federal Reserve reported that Americans have more than 1 trillion dollars in revolving debt, which includes debt like credit cards. Many people are only able to make the monthly minimum payment on their credit cards each month. However, a new repayment trick is helping consumers get out of credit card debt faster.

The study produced by researchers at several universities, including Harvard Business School, University of Pittsburgh, the Ohio State University, and the Yale School of Management, show that a repayment by purchase method of paying off credit card debt can be even more successful when it comes to getting the balance down to zero.

This method is also known as a form of budget reckoning where you, as the account holder, review your credit card statement as soon as it is received to evaluate where most of your purchases are made. Rather than make one small payment based on the minimum payment quoted or even just a random lump sum, these researchers believe that by paying off certain expenses, you are more likely to make headway when it comes to paying off the balance.

The research recommends that you look at specific line items and see which items can be paid off each month. For example, instead of making a payment of a random amount, such as $100, add together the number of meals charged that month and pay that amount to cover all the food items purchased that month. You could also target a certain expense, such as a clothing purchase or a travel expense.

By paying off a specific item or type of expense, you are holding yourself accountable for what you spend every month. In addition, researchers argue that the cardholder feels more of a sense of accomplishment after paying off a specific item rather than throwing a minimum amount towards a large balance.

American Express offers a similar plan called “Pay It Plan It,” which lets cardholders split up large purchases of more than $100 to repay them over time. A fixed monthly fee comes with the use of this program.

We offer some important tips for eliminating credit card debt. Some utilize the snowball method whereby they focus all their efforts in paying a higher interest card down, focusing on one card at a time. Another method is through the “island” approach where the consumer has two credit cards: one which is paid in full every month and the other card, which is a promotional no-interest or low-interest rate for big purchases, allowing the person to finance those large purchases over time. Keeping to a strict budget is important if you are planning on using this approach.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Robocall Harassment Suit Results in $9 Million Judgment

Posted on November 20, 2018by Admin

Robocalls seem to have become a common nuisance for many Americans. While it may seem like you have no choice but to deal with these annoying phone calls, for many who were dealing with robocalls from a debt-collection company in California, they have received justice in a recent settlement.

The settlement involves IQor Holdings and its subsidiary, Allied Interstate. Allied Interstate is alleged to have harassed consumers in 18 California counties with thousands of robocalls. The lawsuit was originally filed by the Riverside County District Attorney’s Office. Later, Santa Clara, San Diego and Los Angeles counties joined, and these counties were then followed by Solano, Sonoma, Santa Cruz and San Mateo counties.

Out of this $9 million, $1 million will go towards covering the government’s attorney’s fees and legal expenses. The rest of the settlement will be divided appropriately between the counties listed in the lawsuit. The largest four counties will each receive $1.6 million, and the rest will be divided among the other counties.

Allied Interstate refused to admit any wrongdoing and insisted in a statement that the calls mentioned in the lawsuit involved calls dating back to 2011 and that technology had evolved based on interpretations of the law. The company maintained that the calls were within legal requirements and that their new policies have been adjusted in accordance with the law.

However, this case was the eleventh one filed against the company in over ten years. Before the most recent settlement, the largest payout was $1.75 million, paid to the Federal Trade Commission. In 2017, the company also paid $500,000 in a settlement brought by five other states.

The company is also required to provide training to its employees about regulations regarding debt collection calls. In addition, the company is required to keep records of calls and complaints and conduct third-party annual audits for the next five years.

This lawsuit does not represent an isolated instance. Callers are contacted every day from robocalls. According to data from YouMail, a robocall blocking service, in the month of August 2018, consumers were bombarded with over 148.8 million automated messages daily. These figures break down further to 1.6 calls every second for an average of 13 calls per person per month. Many people get even more than these numbers indicate.

You do have rights if you are one of the Americans being harassed by repeated robocalls. One can hope that this lawsuit will send a warning to other companies doing the same, but in the event it does not, these calls should be reported to the FTC and your local law enforcement.

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Bankruptcy Law, Credit, Credit Card Debt, Debt Relief, Timothy Kingcade Posts

New FICO Program Aims to Help Consumers Improve Credit Scores

Posted on November 15, 2018by Admin

Consumers are always looking for new ways to improve their credit scores. Lenders and other financial institutions use these scores to determine whether a consumer is a risk when it comes to receiving a loan or credit so it is important that the scores reflect a consumer’s positive financial behavior. Currently, several different credit scores are available to financial institutions and lenders based on consumer behavior, but now there is one more as FICO launches its “opt-in” credit score.

FICO is the largest and arguably best-known company that provides software to calculate a person’s credit score. Originally known as Fair, Issac and Company, FICO has now become a fixture for consumer lending in the U.S, and a consumer’s FICO score is often seen as a major factor in determining a consumer’s fiscal responsibility.

The traditional way of improving a credit score has been for the consumer to exercise good financial behavior, such as paying bills on time, keeping a low balance on their credit card accounts, and avoiding spending over their given card’s limit. While this behavior is still encouraged, FICO is offering a new way to incorporate good financial data into a consumer’s FICO credit score.

This new score is being referred to as the Ultra FICO Score. It is a product created in partnership with two other financial institutions, Finicity and Experian, and allows the consumer to give these companies permission to have electronic access to certain financial information that will help boost their credit scores. This access can include data from the consumer’s bank accounts to show how long these accounts have been open, provide proof that the consumer has savings and show frequency of activity in these accounts.

For consumers who have credit scores in the upper 500s to lower 600s, it is hoped that the Ultra FICO program will help these individuals rebuild their credit, especially if they are struggling after a significant crisis in their lives. This program is expected to launch at the start of 2019. However, the access to the pilot program will be limited until approximately mid-2019.